The global pandemic and recent geopolitical turbulence have prompted American chip developers to consider relocating their production facilities closer to the United States. This shift aims to mitigate disruption in the logistics caused by international upheavals. In this vein, South Korean company, SK hynix, is contemplating constructing a facility to package High Bandwidth Memory (HBM) chips in Indiana, thereby enabling NVIDIA to gain access to its accelerators without the need for overseas shipping.
Considerations for National Manufacturing
Notably, the transition towards “national manufacturing” necessitates the operationalization of TSMC facilities in Arizona. These factories are charged with commencing production of the essential NVIDIA accelerator chips. Currently, these chips are being manufactured in Taiwan by TSMC, which also packages them alongside the HBM memory chips arriving from South Korea. Only after these processes are complete do NVIDIA’s partners get the opportunity to install accelerator chips with memory on one substrate on printed circuit boards.
SK hynix’s Plan for NVIDIA Chip Packaging
According to the Financial Times, SK hynix is investigating a plan to package both HBM and NVIDIA chips at a proposed facility in Indiana, slated to commence operations in a few years. This project makes sense given TSMC’s potential ability to manufacture NVIDIA chips in Arizona; the only components that would then require overseas shipping are the HBM memory chips produced by SK hynix. The assembly of the final product, consisting of the HBM and NVIDIA’s accelerator chip, would take place within the U.S.
Expanding US Contributions
At present, no more than 3% of chip packaging services take place in the United States. However, Intel is working towards boosting this percentage and it appears that SK hynix’s project could also contribute towards achieving this goal. While SK hynix’s representatives have not officially commented on this development, hints have been dropped regarding the company’s consideration of potential investment opportunities in the U.S. economy.